Persistent respiratory methicillin-resistant Staphylococcus aureus (MRSA) infections have become increasingly common in cystic fibrosis (CF) patients, with a prevalence of almost 30% in CF patients in the US. This is concerning, as MRSA positivity is associated with a faster decline of lung function and a 6 years shorter median life-expectancy compared to CF patients without MRSA. Unfortunately, there is no effective and safe treatment of persistent MRSA infections available for CF patients. Savara Inc. is developing a novel inhaled dry-powder form of vancomycin (AeroVanc) for the treatment of respiratory MRSA infection in CF patients. The product is intended for convenient self-administration at home. It is envisioned to improve lung function, as well as to decrease the need for intravenous (IV) antibiotics, and hospitalization. Vancomycin is the drug of choice for the treatment of bronchopneumonia due to MRSA, but it is only available in IV form, it penetrates the lungs poorly by IV administration, and may also be associated with systemic toxicity, generally limiting its use to hospital settings. There is significant clinical advantage n delivering vancomycin directly to the site of infection in order to improve clinical efficacy, and reduce systemic exposure. The off-label administration of the IV product has proven to be encouraging. The published data from clinical trials4-11 indicate that pulmonary administration of vancomycin is safe and well tolerated, and reduces or may even eliminate MRSA from the sputum of CF patients. However, the IV formulation has not been optimized for pulmonary administration. There are considerable technical challenges and limitations to its use that have not been adequately addressed, and that impact its clinical viability. Savara has overcome the significant technical challenges to the development of an inhalable vancomycin powder by using innovative particle coating technology, enabling for the first time the development of a practical and effective inhalation treatment of pulmonary MRSA infection. Savara's novel dry-powder formulation of vancomycin, AeroVanc, has physical, chemical and aerodynamic properties ideally suited for delivery using an off-the-shelf inhaler device. Savara has advanced the product development rapidly, and has completed the aims of a Phase 1 SBIR, as well as progressed beyond the aims by conducting a successful Phase I clinical study in healthy volunteers. The aerosol performance of AeroVanc, the rat 5-day inhalation toxicology study, as well as the Phase I clinical study indicate that AeroVanc is a highly efficient and well-tolerated formulation of vancomycin, and is well suited for further non-clinical studies, and further clinical development in MRSA infected CF patients. This SBIR Phase 2 project focuses on development of an automated capsule filling and packaging process required for further clinical studies, completion of IND- enabling 28-day inhalation toxicology studies in two species, submission of an IND, and finally, the conduct of a Phase IIa clinical proof of concept study in respiratory MRSA infected CF patients.